Notice to the Market - QGEP Provides An Asset Portfolio Update

Manati Field

Fourth quarter production at Manati Field averaged 6.1 MMm3 per day, bringing full year 2013 production to an average of 6.0MMm3
per day, at the high end of the Companys guidance range.

As previously announced, a surface gas compression plant will be installed at the Field in order to maintain production capacity.
The bidding process for the construction of the compression plant has been completed, and the results have been submitted
for the operators internal approvals. This approval is expected by the end of the first quarter of 2014, and the construction
of the plant is expected to begin in mid-2014.

Queiroz Galvão Exploração e Produção S.A. holds a 45% participating interest in the Block, which is operated by Petrobras
(35%).

BM-S-8

The first phase of drilling an appraisal well at the significant Carcará discovery in BM-S-8 began in December. Operational
issues were faced during the drilling, and the well has been abandoned. Drilling will be carried out in two phases, due to
the need for a rig with equipment suitable for drilling deep reservoirs with a high level of operational efficiency and safety.

The first phase of drilling in this prospect is expected to begin by the end of the first quarter of this year. The second
phase should begin in the fourth quarter of 2014. Both the drilling and the Drill Stem Test (DST) are expected to be concluded
in mid-2015. The Consortium will also perform an Extended Well Test (EWT) at the Carcará appraisal well and first oil is expected
by the end of 2018.

Additionally, drilling at the Guanxuma prospect is expected to begin in mid-2015. This prospect is located approximately 30
km off the Carcará Discovery in the pre-salt of the Santos Basin.

BM-J-2

In December 2013, QGEP submitted an Evaluation Plan for its 100%-owned Block BM-J-2 to the Agência Nacional de Petróleo, Gás
Natural e Biocombustíveis (ANP). In August, the Company filed a Notice of Discovery with the ANP based on the identification
of anomalies in the gas detector and oil shows in the cuttings, as well as the interpretation of pay zones in the Logging
While Drilling (LWD) profiles in its 1-QG-5A-BAS well. The well was drilled to a final depth of 4,800 meters, 750 meters below
the salt layer. Negotiations with the Agency regarding the next steps for the block are currently underway, and QGEP expects
final approval for the Evaluation Plan during the first half of 2014.

"This report is part of our established practice of providing investors with periodic updates on developments in our asset
portfolio. In keeping with this practice, we are pleased to report that operating activities are continuing apace at the first
well of the Atlanta Field in Block BS-4, where QGEP is the operator with a 30% ownership interest", said Lincoln Guardado,
CEO of QGEP.